Marketdash
Back to News

Martin Shkreli's Biotech Short Bet Backfires as Stock Rockets 440%

MarketDash Editorial Team
2 hours ago
The infamous "Pharma Bro" bet against a small biotech company's experimental therapy, but a successful clinical trial sent the stock soaring and his short position into the red.

Sometimes the market has a sense of humor. Martin Shkreli, the controversial investor better known as "Pharma Bro," decided two weeks ago to short Capricor Therapeutics Inc. (CAPR), a California-based biotech company. His thesis was simple: the company's HOPE-3 cell therapy for Duchenne Muscular Dystrophy wouldn't work. He even mockingly called it "COPE-3."

"It will not work. This is the company's only asset," Shkreli declared with characteristic confidence.

Then reality intervened. Last week, Capricor cleared a major regulatory hurdle with trial results showing "strong and definitive evidence that Deramiocel can meaningfully improve the course of Duchenne muscular dystrophy." The stock didn't just rise—it exploded 440% in a single trading session, turning Shkreli's short bet into a spectacular loss.

When Momentum Hits Like a Freight Train

The momentum score in MarketDash's rankings measures a stock's price movements and volatility across multiple timeframes, then ranks it as a percentile against the broader market. A sudden spike in momentum typically signals major volume increases, heightened volatility, and sharp price action—usually triggered by significant news or fundamental catalysts.

And Capricor (CAPR) certainly delivered on that front.

Following the positive phase-3 HOPE-3 trial results evaluating Deramiocel for treating Duchenne Muscular Dystrophy, the stock vaporized Shkreli's short position. He'd been expecting shares to drift down to around $2, but instead they rocketed in the opposite direction. The company's momentum score tells the story in numbers: it jumped from 3.83 to 96.4 within just one week.

The Response

Shkreli hasn't taken the loss quietly. He's responded by attacking the data itself, accusing Capricor CEO Linda Marban of lying and putting an unrealistic positive spin on the results. Whether he's right or just defending a losing position is anyone's guess, but the market has clearly made its judgment.

Beyond the momentum surge, Capricor now shows favorable price trends across short, medium, and long-term timeframes—a complete reversal from where things stood when Shkreli initiated his short position. It's a reminder that betting against biotech companies ahead of clinical readouts can be hazardous to your portfolio's health, no matter how confident you feel about the science.

Back to News

Martin Shkreli's Biotech Short Bet Backfires as Stock Rockets 440%

MarketDash Editorial Team
2 hours ago
The infamous "Pharma Bro" bet against a small biotech company's experimental therapy, but a successful clinical trial sent the stock soaring and his short position into the red.

Sometimes the market has a sense of humor. Martin Shkreli, the controversial investor better known as "Pharma Bro," decided two weeks ago to short Capricor Therapeutics Inc. (CAPR), a California-based biotech company. His thesis was simple: the company's HOPE-3 cell therapy for Duchenne Muscular Dystrophy wouldn't work. He even mockingly called it "COPE-3."

"It will not work. This is the company's only asset," Shkreli declared with characteristic confidence.

Then reality intervened. Last week, Capricor cleared a major regulatory hurdle with trial results showing "strong and definitive evidence that Deramiocel can meaningfully improve the course of Duchenne muscular dystrophy." The stock didn't just rise—it exploded 440% in a single trading session, turning Shkreli's short bet into a spectacular loss.

When Momentum Hits Like a Freight Train

The momentum score in MarketDash's rankings measures a stock's price movements and volatility across multiple timeframes, then ranks it as a percentile against the broader market. A sudden spike in momentum typically signals major volume increases, heightened volatility, and sharp price action—usually triggered by significant news or fundamental catalysts.

And Capricor (CAPR) certainly delivered on that front.

Following the positive phase-3 HOPE-3 trial results evaluating Deramiocel for treating Duchenne Muscular Dystrophy, the stock vaporized Shkreli's short position. He'd been expecting shares to drift down to around $2, but instead they rocketed in the opposite direction. The company's momentum score tells the story in numbers: it jumped from 3.83 to 96.4 within just one week.

The Response

Shkreli hasn't taken the loss quietly. He's responded by attacking the data itself, accusing Capricor CEO Linda Marban of lying and putting an unrealistic positive spin on the results. Whether he's right or just defending a losing position is anyone's guess, but the market has clearly made its judgment.

Beyond the momentum surge, Capricor now shows favorable price trends across short, medium, and long-term timeframes—a complete reversal from where things stood when Shkreli initiated his short position. It's a reminder that betting against biotech companies ahead of clinical readouts can be hazardous to your portfolio's health, no matter how confident you feel about the science.